CACC Covered Call Strategy
CACC (Credit Acceptance Corporation), in the Financial Services sector, (Financial - Credit Services industry), listed on NASDAQ.
Credit Acceptance Corporation provides financing programs, and related products and services to independent and franchised automobile dealers in the United States. The company advances money to dealers in exchange for the right to service the underlying consumer loans; and buys the consumer loans from the dealers and keeps various amounts collected from the consumers. It is also involved in the business of reinsuring coverage under vehicle service contracts sold to consumers by dealers on vehicles financed by the company. The company was founded in 1972 and is headquartered in Southfield, Michigan.
CACC (Credit Acceptance Corporation) trades in the Financial Services sector, specifically Financial - Credit Services, with a market capitalization of approximately $5.49B, a trailing P/E of 12.44, a beta of 1.36 versus the broader market, a 52-week range of 401.9-565.14, average daily share volume of 193K, a public-listing history dating back to 1992, approximately 2K full-time employees. These structural characteristics shape how CACC stock options price implied volatility around earnings windows, capital events, and macro-driven sector rotations.
A beta of 1.36 indicates CACC has historically moved more than the broader market, amplifying both the directional payoff and the realized volatility relative to an index-equivalent position.
What is a covered call on CACC?
A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income.
Current CACC snapshot
As of May 15, 2026, spot at $544.42, ATM IV 17.50%, IV rank 0.00%, expected move 5.02%. The covered call on CACC below is built from the same end-of-day chain, with strikes snapped to listed contracts and premiums pulled from the bid/ask midpoint at a 98-day expiry.
Why this covered call structure on CACC specifically: CACC IV at 17.50% is on the cheap side of its 1-year range, which means a premium-selling CACC covered call collects less credit per unit of strike-width risk, with a market-implied 1-standard-deviation move of approximately 5.02% (roughly $27.31 on the underlying). The 98-day window matched to the front-month expiry keeps theta exposure bounded while still capturing the post-snapshot move; longer-dated CACC expiries trade a higher absolute premium for lower per-day decay. Position sizing on CACC should anchor to the underlying notional of $544.42 per share and to the trader's directional view on CACC stock.
CACC covered call setup
The CACC covered call below is built from the end-of-day chain, with each option leg priced at the bid/ask midpoint of its listed strike. With CACC near $544.42, the first option leg uses a $560.00 strike; additional legs (when the strategy has them) anchor to spot-relative offsets. Premiums come from the bid/ask midpoint on the listed CACC chain at a 98-day expiry; the cross-strike IV skew is reflected directly in the per-leg values rather than approximated. Quantity sizing assumes one contract per option leg (or 100 CACC shares for the stock leg in covered calls and collars).
| Action | Type | Strike / Basis | Premium (est) |
|---|---|---|---|
| Buy 100 shares | Stock | $544.42 | long |
| Sell 1 | Call | $560.00 | $13.50 |
CACC covered call risk and reward
- Net Premium / Debit
- -$53,092.00
- Max Profit (per contract)
- $2,908.00
- Max Loss (per contract)
- -$53,091.00
- Breakeven(s)
- $530.92
- Risk / Reward Ratio
- 0.055
Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium.
CACC covered call payoff curve
Modeled P&L at expiration across a range of underlying prices for the covered call on CACC. Each row is one sampled price point from the computed payoff curve; the full curve uses 200 price points internally before being summarized into 10 rows here.
| Underlying Price | % From Spot | P&L at Expiration |
|---|---|---|
| $0.01 | -100.0% | -$53,091.00 |
| $120.38 | -77.9% | -$41,053.68 |
| $240.76 | -55.8% | -$29,016.37 |
| $361.13 | -33.7% | -$16,979.05 |
| $481.50 | -11.6% | -$4,941.73 |
| $601.88 | +10.6% | +$2,908.00 |
| $722.25 | +32.7% | +$2,908.00 |
| $842.62 | +54.8% | +$2,908.00 |
| $963.00 | +76.9% | +$2,908.00 |
| $1,083.37 | +99.0% | +$2,908.00 |
When traders use covered call on CACC
Covered calls on CACC are an income strategy run on existing CACC stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
CACC thesis for this covered call
The market-implied 1-standard-deviation range for CACC extends from approximately $517.11 on the downside to $571.73 on the upside. A CACC covered call collects premium on an existing long CACC position, trading off upside above the short call strike for immediate income; the short strike selection should reflect the trader's view on whether CACC will breach that level within the expiration window. Current CACC IV rank near 0.00% sits in the lower third of its 1-year distribution, where IV often re-expands toward the mean; this favors premium-buying structures and disadvantages premium-selling structures on CACC at 17.50%. As a Financial Services name, CACC options can move on sector-level news flow (peer earnings, regulatory updates, industry-specific macro data) in addition to CACC-specific events.
CACC covered call positions are structurally neutral to slightly bullish; the modeled P&L assumes European-style exercise at expiration and ignores early assignment, transaction costs, dividends paid before expiry on the stock leg (when present), and the bid-ask spread on the listed chain. CACC positions also carry Financial Services sector concentration risk; news flow inside the sector (peer earnings, regulatory shifts, supply-chain headlines) can move CACC alongside the broader basket even when CACC-specific fundamentals are unchanged. Short-premium structures like a covered call on CACC carry tail risk when realized volatility exceeds the implied move; review historical CACC earnings reactions and macro stress periods before sizing. Always rebuild the position from current CACC chain quotes before placing a trade.
Frequently asked questions
- What is a covered call on CACC?
- A covered call on CACC is the covered call strategy applied to CACC (stock). The strategy is structurally neutral to slightly bullish: A covered call pairs long stock with a short out-of-the-money call, collecting premium and capping upside above the short strike in exchange for income. With CACC stock trading near $544.42, the strikes shown on this page are snapped to the nearest listed CACC chain strike and the premiums come straight from the end-of-day bid/ask midpoint.
- How are CACC covered call max profit and max loss calculated?
- Max profit equals short-strike minus cost basis plus premium times 100; max loss is cost basis minus premium (at zero). Breakeven is cost basis minus premium. For the CACC covered call priced from the end-of-day chain at a 30-day expiry (ATM IV 17.50%), the computed maximum profit is $2,908.00 per contract and the computed maximum loss is -$53,091.00 per contract. Live intraday quotes will differ as the chain moves through the trading session.
- What is the breakeven for a CACC covered call?
- The breakeven for the CACC covered call priced on this page is roughly $530.92 at expiration, derived from end-of-day chain premiums. Breakeven is the underlying price at which the strategy's P&L crosses zero ignoring transaction costs and assignment risk. The current CACC market-implied 1-standard-deviation expected move is approximately 5.02%; if the move sits well outside the breakeven distance, the structure's risk-reward becomes correspondingly tighter.
- When should you consider a covered call on CACC?
- Covered calls on CACC are an income strategy run on existing CACC stock positions; traders typically sell calls at 25-35 delta with 30-45 days to expiration to balance premium against upside cap.
- How does current CACC implied volatility affect this covered call?
- CACC ATM IV is at 17.50% with IV rank near 0.00%, which is on the low end of its 1-year range. Premium-buying structures (long call, long put, debit spreads) are relatively cheap in this regime; premium-selling structures collect less credit per unit risk.